3 Reasons Why This Awesome Cafe Is Failing – “The Profit” Model

For the Holidays my family and I went down to the small town of Sierra Vista, AZ to visit my wife’s family.

Every time we visit S.V. we have a tradition of going to our favorite local diner for breakfast, Cafe 92.

The food is delicious, the atmosphere has the small town charm we love and the prices are too good to pass up. Also the food is delicious (did I say that already?).

I am a huge fan of the TV show The Profit. Marcus Lemonis is one of the smartest business men I have ever come across. If you have seen the show you know he is all about People, Product, and Process.

Having spoken with the owner and several employees it became very clear to me that this restaurant was struggling to survive. The people in the company were friendly and fantastic, the product was top notch. What was broken was the process.

I was able to identify 3 things very quickly that could be changed about their process and their restaurant marketing that would immediately increase revenue.

1. Worst Signage I have ever seen (or never saw)

I have been to Sierra Vista probably around 50 different times. Every time I have visited S.V. I have driven right past Cafe 92 multiple times. But amazingly I never knew it existed.

It wasn’t until about my 45th visit that I even found out about Cafe 92. It wasn’t from seeing it right off the highway either. My father-in-law took our family there for breakfast.

Even as we were pulling up to the place that I had passed so many times and never noticed, I was looking for it wondering where it was.

The sign is old and faded and the color scheme makes it truly invisible to someone passing along. It is about as invisible as a static banner ad online.

Do You See The Restaurant Signage?

How about if we get a little closer?

Still having trouble seeing the business sign?

Mostly white font on white background, old and faded. You’ll also notice the light colors that fade into white. Not good if you are trying to grab someone’s attention while they are driving 55 mph down the highway.

Spending a few thousand dollars to upgrade the sign on the building and putting a sign right on the highway would go so much farther in bringing in passing traffic.

(The signage is so bad that after looking at pictures of the sign 5 times I just finally right now realized that the cafe is actually named Highway 92 Cafe not Cafe 92)

Here is a quick example of a BIG improvement on the signage that I would implement asap:

I understand why they have never put up a new sign. If you are struggling to make a profit it becomes very difficult to justify spending money they probably don’t have for a new sign.

It is so easy to get caught up in trying to survive that they become blinded to smart business decisions that will help them grow and thrive.

I guarantee they get zero drive by customers who notice the place and stop.

2. Terrible Use Of Real Estate (gift shop)

When you sit down to your meal you will notice that each table has a flyer with all of the table settings. What is this flyer for you ask? Is it a desert menu? Is it an advertisement for their most popular dish?

Nope. Naturally it is a flyer advertising the gift shop they have inside the store. Check out the lineup of products in the gift shop and see how this matches with a cafe.

Baseball cards, stamps, 8×10 movie star pictures, movie posters, comic books, magazines and pocket books. But not to worry, you get free copying from their copy center if you are a customer.

Clearly this restaurant suffers from an identity crisis. There literally is a white board in the “gift shop” that says something to the affect of ‘we have stuff for your man cave’.

Here is what the gift shop looks like before they decide to open it for business during the day.

Talk about eyesore that steals from the ambiance. As much as I like the childrens blankets covering up the merchandise as a design idea, it may cheapen the look of the place just a little.

Here are the baseball cards and stamps on display.

Apart from the fact that I have never seen one person ever purchase anything from this “gift shop”, it is centrally located right in the middle of the dining area.

You could remove the gift shop entirely and add another 3 booths and 1 large table so that critical section of the cafe would actually generate revenue.

3. Dont accept Credit Cards.

If you’re like me you don’t often carry around cash anymore. In fact anytime I use cash at a gash station or convenience store I feel like everyone in line is staring at me because I am slowing the line down.

With the new mobile credit card solutions like Square it is so easy to accept credit cards that even Christmas Tree lots are accepting now.

So a business in this day and age has no excuse not to accept credit cards.

But as you walk in to the restaurant this is what you see:

You’ll notice the little message on the bottom of the page: “If credit cards were accepted meal prices would increase approximately $0.50 per meal, we are attempting to keep our prices as low as possible.”

Let me ask you, would you be willing to pay $0.50 more per meal to have the convenience of paying by credit card?

The answer is YES. You do it all day every day everywhere you go.

Every company in the world increases their prices to cover the cost of accepting credit cards. It’s a cost of doing business that gets passed on to the consumer.

What makes this out to be such a problem for Highway 92 Cafe is that their prices are already ridiculously low. Too low. Look at this menu (which we could discuss as #4 reason they are failing) and check out the prices for these meals.

So you’re telling me you won’t take credit cards because you’re worried your prices are going to be too high? I mean $3.99 for a meal? Really?

If you asked me how much a meal like that should cost and still be really inexpensive I would probably say something like $7 or $8.

I don’t know how this restaurant has stayed in business for over 10 years charging those prices for a full meal and not accepting credit cards.

I once had to run down the street to find an ATM just so I could pay because I forgot they only took cash.

A simple investment in a $400 ipad and signing up with Square or Paypal’s mobile CC processor would not only bring you into the modern era but also increase business.

Raising the prices to accept credit cards is a no brainer and should have happened years ago.

But I guess because they won’t ever get any drive by customers (see problem #1) the patrons all know it’s cash only so they really only need to fix this once they fix their signage.

But I digress. I go back to the biggest glaring problem with why they are failing instead of thriving:

They could almost double their revenue right now if they simply increased prices to where they should be. I know that would be a hard sell to them since clearly they are concerned about raising their prices by $0.50 much less $4.00 but it needs to happen…yesterday.

Conclusion

This Cafe has everything that I think is charming about a small town diner. It just kills me to think that with a few simple changes to their business processes they could not only make big revenue growth but they could become a destination in Sierra Vista and a staple for that community.

P.S. There are other things I didn’t mention like the fact that there is no clear entrance to the restaurant, and the decor inside is a cornucopia of head scratchers but I thought I would cover the things they could do quickly to increase revenue right now.

About The Author

Adam White is the founder of Website Rocket, an online software service that helps small businesses do their own website promotion. He has worked in the internet marketing world since 2000 and has written and directed a feature film. He lives in Arizona with his wife and 6 children.

This is really great small business advice. I really like the fact that you didn’t just focus in on the “bad” things about the cafe and stop there. You took the time to think of practical ways that they can make beneficial changes to their business. That’s what it’s all about!

I hope that they take your advice. 🙂 Funny you mentioned a TV show as this reminded me of the Gordan Ramsey show, Kitchen Nightmares, where he helps struggling restaurants turn their businesses around. Seems like this business has an excellent product and just needs some focus and marketing!

I have seen businesses like this, too, where clearly the business owner has multiple interests and tries to mash them together. In this case, it seems like the memorabilia biz needs to be diverted to craigslist or eBay or some other venue as it definitely clashes with the shop. I totally get that sometimes you love something and want to bring it into other areas of your life, but I agree that the gift shop doesn’t fit in with the restaurant.

As my father took us around to small, out-of-the-way restaurants when we were younger, I agree with this article. The sign alone! My goodness. And it’s very fool-hardy to just rely on local customers, especially if the food is good. Hopefully, they can implement something and up their business. And I agree totally with Mandy’s idea of doing their shop maybe online….Ebay, Amazon, Etsy….there are soo many other options nowadays.

I really like this post on local business advive because you sound so loyal to the cafe. It’s really clear you care about it and want it to succeed. I agree that the prices are bizarrely very low and the sign is terrible. Signs are very important on a highway, obviously.